AT&T's Genus satellite phone goes on sale

The $US799 TerreStar Genus is for government and business and will work on both 3G and satellite networks

AT&T is finally selling its satellite-3G smartphone, the TerreStar Genus, which can be switched from AT&T's network to a satellite for coverage all over the U.S.

The Microsoft Windows 6.5 device looks much like a normal smartphone, different from the larger, more exotic devices that have traditionally been sold for satellite calls. But Genus users will still pay a premium for the extra coverage, with a rate of $US0.65 per minute for voice calls on top of a special $24.99-per-month satellite plan. Data costs $5 per megabyte, and text messages are $0.40 each. Both a 3G (third-generation) and a satellite plan are mandatory.

Satellite communication is starting to trickle down from the rarefied world of generals and globe-trotting CEOs to workers who need to make calls and use the Internet outside cellular coverage areas. Earlier this year, the investment company Harbinger Capital Partners acquired satellite company SkyTerra, and it plans to build LightSquared, a hybrid satellite and 4G network across the U.S., to be sold wholesale to other carriers next year.

AT&T has been planning to offer access to the recently launched TerreStar satellite for more than a year. TerreStar was launched into geostationary orbit 22,000 miles above North America last July. The carrier said last September it would introduce the TerreStar Genus in the first quarter of this year. On Tuesday, it cited device and network testing as reasons for the delay. AT&T's relationship with TerreStar isn't exclusive, and the satellite company said last year it was in talks with a Canadian carrier as well.

The Genus isn't even being offered to ordinary consumers, but to "corporate responsibility" customers, whose cellular purchases are handled by an employer. AT&T's targets include government agencies, utilities, and companies in the transportation, energy and shipping businesses. But the device is intended as an everyday phone, with satellite as a supplement to 3G. It has a 2.6-inch touchscreen as well as a physical keyboard, and one tap of an on-screen button will direct the phone to find the satellite and connect to it. The device costs $US799 plus shipping and tax, and a contract is not required.

Large areas of the U.S. with low population density don't have cellular networks yet. The Genus will provide service in any location with a clear view of the southern sky, across all 50 states as well as Puerto Rico, the U.S. Virgin Islands and the country's territorial waters, according to AT&T. Unlike global satellite networks such as Iridium, it doesn't provide coverage outside the U.S.

The key to making satellite phones useful to the industries that AT&T wants to serve will be supplying specialized applications, said analyst Phil Marshall of Tolaga Research. It can't rely on companies developing their own in-house, but could turn to third-party software vendors, he said.

"The market probably should be seeded, with applications already there," Marshall said.

If AT&T can prove there is a market for phones like the Genus, and discovers the right sales and development channels, then other carriers such as Verizon or Sprint Nextel might step in later with their own plans using TerreStar, he said.

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Stephen Lawson

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